Fortis Healthcare shares gain over 6% after IHH gets open offer approval from SEBI after seven years

Shares of Fortis Healthcare Ltd. gained as much as 6% on Monday, October 6, after IHH Healthcare Berhad received approval from the Securities and Exchange Board of India to proceed with the Open offer for Fortis Healthcare, to increase their stake in the hospital chain by another 26%.

The approval comes seven years after it had acquired 31.1% stake in Fortis, back in 2018.

Malyasia-based IHH has received approval from the Indian market regulator for the open offer in Fortis Healthcare and Fortis Malar Hospitals.

In 2018, IHH had bought 31.1% stake in Fortis for ₹4,000 crore. IHH's open offer for another 26% stake was set to open on December 18, 2018 and close on January 1, 2019, and was worth ₹3,300 crore.

However, the open offer was stalled due to legal disputes, including a Supreme Court litigation, between Daiichi Sankyo and the former promoters of Fortis Healthcare, the Singh Brothers — Malvinder and Shivinder.

In September 2022, IHH said the Supreme Court had paved the way for the open offer, subject to SEBI approval.

Fortis Healthcare is still waiting for the entire information, following which there would be clarity on pricing in the next few days.

In 2018, Fortis' open offer price was ₹170 per share, and the offer size was ₹3,349 crore.

At present, Fortis' current market price of ₹980 per share is up 4.7 times since 2018. Its open offer size at the current market price is ₹19,308 crore.

Shares of Fortis Healthcare are currently trading 5.8% higher on Monday at ₹1,037.5. The stock is up 7% in the last one month. The stock is also reacting to the

first major revamp of the Central Government Health Services Scheme (CGHS) since 2014,.

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